We need a Federal Tax Payer Bill of Rights

Part of the problem with our federal government is the spending. Neither John McCain or Barack Obama have even mentioned on how they are going to balance the budget. They just keep telling us that they are going to cut taxes, but yet spend. Now that doesn’t make any sense now does it? Well in the state of Colorado they have something called the Taxpayer Bill of Rights. A TABOR Is a way of limiting the growth of government by requiring increases in overall tax revenue be tied to inflation and population increases.

In 1992, the voters of the state amended Article X of the Colorado Constitution to the effect that any tax increase resulting in the increase of governmental revenues at a rate faster than the combined rate of population increase and inflation as measured by either the cost of living index at the state level, or growth in property values at the local level, would be subjected to a popular vote in a referendum, a process referred to as “de-Brucing” after Douglas Bruce, the author of the amendment. This applies to any cities and counties in Colorado as well as the state itself. Additionally, any “natural growth” in revenues that exceeded this rate was to be either earmarked for educational improvements or rebated to the taxpayers once an adequate reserve (”rainy day”) fund was established. This has led to a decrease in actual tax revenue (relative to population and inflation) for two reasons. Because the law does not adjust for rising productivity, additional income from year to year among the same population can not be effectively taxed. Secondly, the law only looks at the previous year, leading to a “ratchet-effect”, wherein if tax revenue temporarily lowers in a recession, revenue can not rise back to pre-recession levels without a referendum. In Colorado, these factors have led to a decreasing overall tax revenue in the state.

Referendums to allow revenue increases have generally failed in Colorado, and there are many reasons to account for this trend in addition to voter preference. Referendums have generally been held in “off years” from other elections; experience indicates that holding referendums on dates away from other elections makes changes easier to defeat, as turnouts are lower, and opponents of a measure are often better-organized while the supporters of such measures tend to be less energized and are more likely to vote on specific issues if they are on the ballot at the same time as candidates for office. Additionally, these measures are very technical and deal with dense tax law matters, which may be somewhat impenetrable to the average voter.

In 2000, an amendment known as Amendment 23 was passed. This required education spending to increase at a certain rate regardless of revenue, and lead to a greater portion of revenue devoted to education. TABOR and Amendment 23 together required that other cuts in spending be made to offset education increases, and many of these cuts were unpopular. Many Coloradans began calling for “TABOR reform”.

In November 2004, both houses of Colorado’s legislature became controlled by Democrats, and Democrats were elected to the U.S. Senate and U.S. House, replacing Republicans. Many saw this as a reaction against TABOR, and days after the election, Republican governor Bill Owens announced a plan to reform TABOR. In November 2005, Coloradans approved a ballot measure that loosened many of TABOR’s restrictions. One of these changes allows the state to spend an amount equal to the highest amount of the last five years, not necessarily the last one year.

Infomation was provided by Wikipedia.

Read article X of the Colorado Constitution.

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